Can Mandatory Disclosure of CSR Information Drive the Transformation of Firms towards High-Quality Development?

Abstract

This paper establishes a quasi-natural experiment grounded in the exogenous shock occasioned by the implementation of a compulsory corporate social responsibility (CSR) information disclosure policy. It investigates the ramifications of this mandated CSR information disclosure policy on firms’ total factor productivity (TFP) through the integration of the difference-in-differences (DID) methodology. The investigation reveals that obligatory disclosure of CSR information significantly augments firms’ total factor productivity (TFP) by mitigating agency conflicts and financial constraints. Further analysis elucidates investment efficiency and innovation enhancement as pivotal conduits through which the mandatory CSR information disclosure policy fosters firms’ TFP. The study explores the impact of mandatory CSR information disclosure on firms’ TFP mechanism, which has significant policy value and can provide useful reference for the high-standard development of China’s corporate economic transformation.